Raymond James Downgrades Ziprecruiter Inc. (ZIP:NYE) to “Outperform”

Ziprecruiter Inc Stock Forecast:

According to the predictions of five analysts, the average target price for Ziprecruiter Inc over the next 12 months is $23.80, and the average rating given by the analysts is “Strong Buy.” However, Stock Target Advisor’s analysis of the company’s stock is “Slightly Bearish” based on nine negative signals and five positive signals. Currently, the stock price for Ziprecruiter Inc is $23.25, which is very close to the average target price predicted by the analysts. In the past week, the stock price has increased by 0.13%, and over the past month and year, it has risen by 26.57% and 17.60%, respectively.

Analysts Coverage Change:

  • Barclays maintains an “Overweight” rating on (ZIP:NYE) and lowers the price target to $22 from $25 on the company’s stock.
  • Raymond James Downgrades Ziprecruiter Inc to “Outperform” and maintains the $26 price target.

Ziprecruiter Inc. News:

ZipRecruiter posted weak guidance for the current quarter, causing its stock to drop on Wednesday.

The company cited a “softening hiring environment,” which could be an early indication that the current hot labor market is beginning to cool down. In particular, ZipRecruiter noted that employers have been tightening their recruitment budgets and carrying out layoffs, leading to a decrease in sales projections for the current quarter and the full year.

ZipRecruiter expects sales for the current quarter to be between $176 million and $182 million, a decrease of between 23% and 20% from last year, and sales for the full year to fall between 13% and 15%. These results suggest that the job market may be slowing down, which could have significant implications for both job seekers and employers.

Positive Fundamentals:

Ziprecruiter stock is favorable due to its low volatility and stable annual returns compared to its sector peers for a hold period of at least 12 months, putting it in the top quartile.

The company has also demonstrated a superior return on assets, positive cash flow, positive free cash flow, and a high Gross Profit to Asset Ratio compared to its peers, placing it in the top quartile. These factors make it attractive to investors seeking stable returns and long-term value.

Negative Fundamentals:

Ziprecruiter stock is delivering poor risk-adjusted returns compared to its peers, with unpredictable returns even when outperforming. The company also has below-median dividend returns and has been overpriced in comparison to earnings, book value, and cash flow.

The company’s capital utilization has been poor and its earnings and revenue growth have been below median over the past five years. It is advisable to proceed with caution if considering buying the stock.

FA Score (Fundamental Analysis):

The fundamental analysis of Ziprecruiter is “Slightly Bearish” with a FA score of 3.6, where 0 is very bearish and 10 is very bullish.

 

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